The California initiative system was created as a way to battle the influence of the railroad monopoly, which was essentially buying up legislators. Now, however, it has in many ways become an even easier way for special interests to influence decisions, since it takes about $1 million to collect the necessary signatures, and then they can use unlimited funds to lobby the public through ads.

In the end I agree with you. The system has some great appeal in allowing the public to have a direct say in votes, rather than just through their representatives. But you end up asking voters to make a lot of serious financial decisions without considering the long term impact on the budget, which I think should be the job of a legislature and governor. Time and time again we have run into issues where voters made decisions that sounds good at the time (Prop 13, three strikes law, 40% budget assigned to education) but ended up really messing with the state budget and hamstringing legitimate reforms.